Publisher’s Letter

A few years ago as the industry started to make eye contact with healthcare reform, talk of Accountable Care Organizations (ACOs) went from a trickle, to a regular flow of news and updates. Every day, it seems like a new ACO is forming. Medicare Pioneer ACOs, Medicare Shared Savings Participants, Commercial ACOs – the list is now in the hundreds and growing.

The ACOs are obviously leaders of moving our nation from a fee-for-service reimbursement environment to a fee-for-value system, but they aren’t the only changes. Consider the following from this issue of The Journal of Healthcare Contracting:

With healthcare delivery rapidly changing, the American Medical Association – through its “Accelerating Change in Medical Education” initiative – intends to address how young doctors are educated. As a result, the doctors with whom tomorrow’s supply chain executives will interact in the hospital and non-acute-care setting are more likely to have a deeper understanding of the financial impact of their decisions, not to mention a greater adeptness at providing team-based, patient-centered care in multiple settings. In this issue’s Executive Interview, JHC discussed the goals of this new training with Susan Skochelak, M.D., the AMA’s group vice president for medical education.

The transformation of the fee-for-service model to value-based care is not a question of “if” but of “when,” writes Harry Kirschner, managing director, The Advisory Board Company. Advisory Board Company research has shown that over 10 percent of admissions are already covered by risk-based payment models, with over 80 percent of hospitals reporting they already participate in some level of value-based models or will be by the end of 2013. Healthcare reform and dramatic demographic shifts are challenging hospitals to deliver top quality care for less. Kirschner examines supply chain’s role in delivering value-based care, including outcomes-based contracting, and enlisting the clinicians’ support.

As evidence from these and other developments, the way providers deliver care, and are reimbursed, is changing. Success is this new landscape will mean adjusting to the new dynamics.